German cabinet approves draft law on biofuels, and food-based ingredients to continue using

The Environment Ministry said that the German cabinet had approved a draft law on biofuels, allowing for continued use of animal feed and food as biofuels ingredients.

In order to reduce greenhouse gas emissions, Germany's program includes the use of biofuels such as biodiesel or bioethanol in combination with fossil fuels. Oil companies have set greenhouse gas reduction goals, which can be partially met by using biodiesel, often made from waste vegetable oil or rapeseed, and bioethanol, often made from grains or sugar.

The previous German coalition government, which included the Greens and lost power in the February general elections, had planned to phase out food and animal feed ingredient use. The statement released by the Environment Ministry on Wednesday said that food and animal feed ingredients would continue to be used at current levels.

According to the Ministry, palm oil will no longer be counted towards emissions reductions after 2027 due to concerns about its environmental impact in certain regions of the world.

This draft also incorporates the Renewable Energy Directive of the European Union into German law in the transport, electric and heating sectors. The full text of the draft was published Wednesday after it had been repeatedly delayed. The bill must be voted on by the parliament.

Double-counting of biofuel ingredients would be prohibited by the law. Double-counting biofuel ingredients is a regulatory measure whereby certain advanced biofuels or waste-based fuels are given twice the credit towards compliance targets.

German oilseed traders stated that the new law draft was expected to boost prices.

One German rapeseed dealer said, "There is a general relief that the food and feed-based ingredients will be continued to be used. The end of double counting will also be a positive." (Reporting and editing by Tomaszjanowski in Hamburg)

(source: Reuters)